Business NEWS

HSBC seeks $4 bln from property sales to fuel bank’s Asian expansion

By Amarendra Bhushan for CEOWORLD Magazine Updated:April 13, 2009

Europe’s largest bank, HSBC Holdings Plc is looking to sell three of its office buildings, including its London headquarters at Canary Wharf, to raise GBP 2.7 billion or EUR 3 billion.

The other offices on sale include the company’s French office on the Champs Elysées and offices in New York.

HSBC, which recently raised nearly $19 billion (12.9 billion pounds) in a rights issue, said it may sell and lease-back office buildings in New York, Paris and London, including its headquarters at Canary Wharf.

Real-estate firm CB Richard Ellis was hired to head the sale process and it had received interest from potential buyers.

HSBC may shelve the sale process if it does not find sufficient interest. Following the potential sale, the company will lease back the properties for 10 years.

HSBC bought back its building at Canary Wharf for 838 million pounds from ailing Spanish property firm Metrovacesa at the end of last year after the Spanish firm failed to refinance a loan secured on the building.

The bulk of the transactions are likely to be sale and leaseback agreements which would effectively allow the business to operate as normal while leasing as oppose owning the properties.

The bank has its eye on the Asian businesses recently put up for sale by the Royal Bank of Scotland.

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